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FEHBP Premiums: Only Half The Story

Tuesday - 12/1/2009, 4:00am EST

If 2010 turns out to be an "average" medical year, and if you are a family of two and under age 55 you will shell out between $2,850 and $6,300 next year in both premiums and for medical services not covered by your health plan. If you have a very, very bad medical year (a major illness or accident) your outlay could range from a "low" of around $7,000 to as much as $24,000 that you would have to pay.

For the same couple who are over age 55, however, the least they can expect to pay in an average year is about $5,600 and the most they might pay, in premiums and out-of-pocket, would be just over $12,000. Again if one of you suffers a major illness or has a serious accident you could wind up paying out a total of between $9,000 up to as much as $27,000 in premiums and out-of-pocket costs.

In the federal health program (FEHBP,) premiums in each of the plans are the same whether you are a healthy 21-year old marathoner or a bedridden 103-year old retiree. And none of the plans can turn you down because of age, health, hobbies, lifestyle or pre-existing medical conditions. Regardless of what they are. And, the government will pay just over 70 percent of the average premium (more if you work for the highly-unionized U.S. Postal Service or the Federal Deposit Insurance Corp.).

Good times! But...

As we get older our medical costs tend to go up. Older people (the average fed is about 48 years old) pay more out of pocket even if they also have Medicare Parts A and B.

Walton Francis, author of Checkbooks' Guide to Federal Health Plans says it is a mistake, at any age, to focus solely on premiums. You also need to consider your age, family size, current and past medical needs and what you want from a health plan as well as what you are willing to pay for it.

The Checkbook Guide lists "best buys" for singles, couples with and without children, younger (under 55) and older (over 55) workers and for retirees or their survivors. The guide breaks down costs ranging from years when you have no medical services to a year with you are hit with catastrophic bills. And "average" year costs for you and yours.

In almost every case the lowest premiums and total costs to you come in local HMO plans, or in the 7 consumer-driven and high-deductible plans. But there are also bargains in national fee-for-service plans provided you use doctors (hopefully yours) in their network.

By the way, the open enrollment period ends December 14th. If you do nothing, which is what most people do, you will remain in the health plan you are in right now. That could be a costly mistake.

So listen to the show (www.federalnewsradio.com or WFED 1500 AM) and tell a friend. That's 10 a.m. EST. Tell your bosses because they may want to listen, as well because this is work-related and agency-approved. Dozens of departments and agencies have already signed up so that you can shop on-line from your home or office computer. The agency wants you to be happy and make the best choices. To find out if your agency has signed you up, click here.

We've discussed before some efforts underway to reduce the greenhouse emissions of livestock. Now, from the London Telegraph comes a report that, in Australia, about 12 percent of that country's "greenhouse gases originate with agriculture, and some 70 per cent of that amount is blamed on ruminant livestock, with most of it coming from burps." Clinching its place as a Nearly Useless Factoid is the name of the "study leader": John Goopy.

How your Thrift Savings Plan has changed over the past decade
Not only is the calendar year winding down to a close, but the decade will soon end, as well. For the next month, the Daily Debrief is going to be talking about the Stories of the Decade, which will cover the whole scope of issues we discuss here at Federal News Radio. Senior Correspondent Mike Causey is the first to weigh in, explaining that one of the bigger stories of the decade for him has to do with the evolution of the Thrift Savings Plan. Read more here.

What SAMBA has to offer this Open Season
SAMBA Health Plan was originally limited to the FBI and U.S. Secret Service but is now open to all Federal employees. It offers a unique plan designed for dependent children ages 22-27 among many other plans. To earn more about the plan from For Your Benefit, click here.